Megan Pope, financial director for the Vermont Department of Health, told the committee the departments 2026 budget adjustment contains two main requests: an internal transfer of general and federal funds to cover increased charges from the Agency of Digital Services (ADS), and a funding reclassification prompted by federal HR1 that affects how Medicaid may reimburse Planned Parenthood for family‑planning services.

Pope said the department is asking to move $300,000 that was previously budgeted as a Global Commitment investment into the general fund because HR1 placed a one‑year restriction on Medicaid funding to Planned Parenthood for family‑planning services. She described the funding as historically provided through an annual grant intended to support administration, operations and outreach and said that particular grant runs through 06/30/2026.

On the ADS charges, Pope explained that the state agency receives a centralized appropriation for digital services and then allocates or charges departments for desktop support, infrastructure and other IT services. The budget adjustment shifts that appropriation from the agency central office to departments so each department carries its share of ADS costs; she characterized the overall effect as net neutral to the Agency of Human Services but an increase for the Department of Healths internal budget lines.

Committee members asked whether grant payments have been interrupted and how much of the departments budget is federal grant funded. Pope said grant payments have generally continued and estimated that about half of the departments funding historically comes from federal grants, but she warned several grants will expire and renewals are not guaranteed pending the state budget process.

No committee votes were recorded in the transcript. Pope concluded her overview and agreed to field more detailed questions as needed.